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Google Search Bias

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Christopher Pütz

on 9 June 2015

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Transcript of Google Search Bias

Google and the Search Bias - Tim Schneider & Christopher Pütz
Antitrust Investigation
Two-Sided Platform Markets


Critical Appraisal
TEUF 102
"Neutral Search"

Antitrust Investigation
The Bigger Picture
Google Business Model
Google evolved from a pure search engine to a powerful conglomerate

„As our business has evolved, the competitive pressure to innovate will now encompass
a wider range of products and services
, including products and services that may
be outside of our historical core business
- Google Annual Report 2014

Chicken-Egg Problem

FREE as a Business Model - Does it pay off?
Google's Vicious Circle
Legal Background
Article 102 TFEU

"Any abuse by one or more undertakings of a dominant position"

Critical Appraisal
Is the undertaking in a dominant position?
Has the undertaking abused its dominant position?
High market shares
Barriers to entry
Buyer power
Elements for market power
Abusive behavior must be distinguished from normal competitive strategy

Distinction for abusive conduct
- imposing unfair purchase or selling price
- foreclose competitors from the market
Abusive - What does it mean?
Defining the relevant market
Defining the dominant position
Abuse on the advertising side
Results for Google
But what about two-sided markets?
Example Check 24: Competitors are Tech Giants like Google
"A dominant position can only exist on a particular market"
-European Commission
Market shares
Market entry
Consumer Power
Company Power
Abusive behavior may not be detected so far!
Nevertheless Google builds up an empire which might lead to abusive behavior
Abuse on the user side
User pay with their attention indirectly
Users do not know whether they get the most relevant search results (Trust in Google)
The reaction of users to a quality decrease of the search results is difficult to observe
Bigger Picture
Thank you!
Everybody wants to rule the world
Need for Speed
Size matters
The bigger the better
Everything competes with everything
Huge piles of data
Antitrust Investigations against Google
"If we will not endure a king as a political power we should not endure a king over the production, transportation, and sale of any of the necessaries of life." -
John Sherman
Counterarguments by Google
People have more choice than ever before
Google is thriving competition online
EU Vestager
EU Almunia
Posted on Wednesday
15 April 2015
"The Search for
Larry Page:
perfect search engine
should understand exactly what you mean and give you back exactly what you want."

"More choice than ever before"

"it’s clear that:
(a) there’s a
ton of competition
(including from Amazon and eBay, two of the biggest shopping sites in the world) and

Google’s shopping
results have
not harmed the competition"
"Any economist
would say that you typically
do not see a ton of innovation, new entrants or investment
in sectors
where competition is stagnating
dominated by one player
Check 24
depends on search results
Google Shopping
When your biggest supplier is also your biggest competitor
Revenue: 100,- €
Costs for Ads: 80-90,- €
Google uses its
dominant position as a search engine provider
to promote own services like Google Shopping
harms competitors
which depend on Googles main service as a search engine provider
Google may not be alleged to abuse its dominant position on the user side
Digital Market Power
will be defined by collected
Data Size
>> Policy should focus on
Data Concentration

Digital Business Models
will evolve even further into
Full Service Platforms
Innovation Process
, eg. Google Buy Button

Focus on
Cross-Platform Market Power
>> "
" of
both sides
of a
Two-Sided-Plattform Market

Consider a
narrow Market Definition

Information Intermediary
be reduced to pure
Search Engine Service

Don't limit the
Innovation Power

Search Results
additional Services
would rahter
harm the Consumer
Competitive Advantage
Competitive Structures
Absorption of existing businesses
„Our business is characterized by rapid change as well as new and disruptive technologies. We face formidable competition in every aspect of our business.“
Google AR 2014

Vertical diversification is not per se an abuse of a dominant market position
Shopping Sites in Germany
(unique visitors, ‘000s)
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via Twitter: @CBPuetz
Full transcript